The pound hit midweek a whisker off its strongest rate since spring 2018 against the US dollar and over 2% stronger compared to last week against the euro.
There is some evidence that the boost won’t last, so to lock in this rate, do call your trader on 020 8108 5337 and we can talk through your options. For example, a forward contract will secure this rate for 12 months.
The stimulus was comments from the Bank of England governor yesterday that negative interest rates are unlikely, plus the vaccine programme in the UK which, although slower than promised (no surprise there) is nevertheless progressing steadily, with another 165,000 being vaccinated yesterday.
I’m sure most of us over 50 have put our details into a “vaccine calculator” to see when we’ll get ours and can look forward to being safe (or 95% safer anyway) by the spring, whether early or late.
Will the optimism around sterling continue? Our latest currency forecasts suggest not. They will be released in full later this week, but I can tell you that the maximum predictions are only slightly higher than what we have today at around USD1.41 and EUR1.18.
The downside predictions are considerably lower than today’s rate, however, at around USD1.22 and EUR1.02.
Could you afford to pay an extra 10% for your dream property? You would need to find an extra £10,000 for every £100,000 of your budget if the downside predictions are correct. Click here to read The Property Buyer’s Guide to Currency to understand the implications of currency volatility on property purchase and how to contain that risk.
Now, as I always say with predictions, there’s a lot less to them than meets the eye. They are at best an educated guess, but they do suggest a downbeat projection for sterling by the time an overseas property purchase, for example, comes to completion.
Therefore, if you have a trade coming up in 2021 – for example in May or June – it would be prudent to call your trader on 020 8108 5337 and consider locking in your rate.
